CTN Monday, 14 March 2011 14:41 (Updated 6-5-11)
Background: The California Department of Motor Vehicles (DMV) and the California Highway Patrol (CHP) are currently working on a proposal and legislation to consolidate the fee collection activities for the Motor Carrier Permit (MCP) and Bi-Annual Inspection of Terminal (BIT) fees. To learn more about the history of the CHP BIT Program, go to this link:
The two departments have also involved members of the California Dump Truck Owners Association (CDTOA) and other trucking and transportation-related associations in the discussions to gain their comments and support in implementing this new program, which would have the BIT fees collected with the annual MCP renewal fees.
This proposal was developed in response to calls from the industry to reduce confusion, paperwork, and some degree of serious liability to the motor carrier industry, while bringing uniform billing and enforcement to the BIT program. The bi-annual term is being replaced by basic, and the new program will be referred to as the Basic Inspection of Terminals Program. To view a copy of the proposed legislation, go to the CDTOA website.
According to the CHP, “Some carriers were paying their required BIT fees and others were not.” Some carriers were inspected and some were not under the somewhat confusing BIT programs. Industry first raised the issue in meetings with both the CHP and DMV who reviewed the processes and came up with the changes outlined here. The idea was presented to industry representatives who now support the changes.
Under this proposal, the new BIT program would change the bi-annual fee collected by the CHP when inspections are completed (every 24 months) to an annual fee collected by the DMV with the MCP renewal fee. This change will reduce the paperwork and confusion for carriers while also eliminating administrative burdens and payment confusion at CHP that industry has always complained about.
CHP has also confirmed that there will be no additional costs, inspections, or changes with the Controlled Substance and Alcohol Testing (CSAT) program, which CHP calls a carrier inspection program. The CHP CSAT inspection, or carrier inspection, is intended to determine if an employer is in compliance with the drug and alcohol testing regulations, and this inspection will take place at the employer’s principle place of business (main office) and will be timed or scheduled to correspond with the BIT Inspection.
During the scheduling contact, the inspector should determine which drivers are also subject to CSAT and inform the employer of the records and information that must be made available at the time of the inspection. Employers are permitted at least 48 hours to obtain the requested records. If the employer’s consortium or a third-party administrator maintains the records, it is the employer’s responsibility to obtain them and present them during the inspection. For more information on this program, go to: http://www.chp.ca.gov/publications/pdf/csat.pdf
Efficiency, Reduced Costs and a Level Playing Field:
Under this new proposed program, a carrier will file one form and pay one annual MCP and BIT fee to the DMV compared with the current multiple payments and filings to the CHP and DMV. By eliminating most of these administrative burdens, CHP says, “We will be able to focus on the safety inspections and not be concerned with the payment and collection of the BIT fees.” Additionally, CHP says that it can prioritize their inspections on those carriers with the greatest risk or poor safety records.
For the DMV, the fee will be collected with the MCP fee, and the BIT fee schedule will be tied to the MCP fee schedule, and no carrier will receive their operating permit without paying their BIT fees.
This will ensure greater BIT compliance and level the playing field for all carriers, something long asked for by industry.
Here are the specifics of the proposal:
- The “B” in BIT will now stand for “basic,” and the fee will be referred to as a Safety Inspection Fee.
- The fees will be collected annually and the fee structure will match the fee structure currently used for motor carrier permits. This is a significant change. The current BIT fee structure is bi-annual, based on terminal fleet size with additional fees for adding terminals and re-inspections. The new Safety Inspection Fee will be an annual fee based on the vehicle count for the carrier and will correspond exactly to the fee schedule used for motor carrier permits. There are no additional fees for adding vehicles until the next renewal period. The Safety Inspection Fee will range from $130 for a single vehicle carrier to $2,114 for a carrier with 2,001 or more vehicles. For 95% of the carriers this will result in an annual savings. Carriers with 10 or fewer vehicles will see savings ranging from $10 to $111. Carriers with more than 10 vehicles will see slight increases in fees.
- The added terminal and re-inspection fees will be abolished.
- CHP will restructure their inspection program to a performance-based priority system to target new carriers, carriers with poor safety records, and high-risk carriers. This will ensure new carriers learn proper safety, log book rules and all other regulatory rules when they first begin operations to prevent future non-compliance. The performance-based priority system will also ensure those carriers with the greatest safety risks will be inspected, which protects the industry and the general public. CHP will develop the algorithm and adopt regulations for the performance-based inspection system.
- The inspection will include lower GVWR vehicles (10,000 lbs. or more with 2-axles) that were previously not subject to BIT. Now ALL vehicles that require a MCP will also be subject to BIT fees and inspections.
The following is a general list of code section changes that will need to be made to the BIT statute (Veh. Code 34501.12), including:
- Add language requiring the CHP to adopt a performance-based inspection program
- Repeal the 25-month mandate to inspect every truck terminal
- Repeal the 4-month lease exception; repeal carrier assumptions and terminal consolidations
- Retain the current “BIT” acronym, changed the name to the Basic Inspection of Terminals (BIT)
- The additional statutes that would also need to be changed:
- Section 34505.5 (90-day inspection requirement)
- Section 34515 (Maintenance facility or terminal)
- Section 34505.6 (Motor carriers of property and motor trucks: failure to meet requirements)
- Section 34606 (Review of fees)
- Section 34623 (Suspension of Motor Carrier Permit)
- Section 40000.22 (Misdemeanors)
- Sections 7235 and 7236 of the Rev. & Tax Code
Below is the proposed fee structure. Note that for all fleets with 10 or fewer vehicles, the fees will decrease.
To accomplish these proposed changes, legislation has been drafted to amend the various sections of the Motor Vehicle Code and the Revenue and Taxation Code. The Revenue and Taxation Code is important because this section exempts motor carriers from having to pay city and county business licenses fees throughout the state. Note: We have asked for a simple amendment to add the words “and fees” after the word “taxes” in these two sections within Rev. & Tax Code, sections 7233 and 7234.
Again, the changes will reflect the new fee schedule, the linkage to the motor carrier permit, the new inspection performance-based priority system, and the elimination of the previous BIT fee structure and requirements. It is hoped the legislation can be introduced in the upcoming session in 2011, the second year of a 2-year term.
Once implemented, carriers will pay their Safety Inspection Fee and Motor Carrier Permit Fee with their annual DMV renewal application. DMV will continue to issue the operating permits in the same manner as before with no increased administrative costs. The CHP will schedule inspections based on their approved safety algorithm, and the inspection will focus only on safety, not fee collections of any type. If a carrier has a valid Motor Carrier Permit, then he/she must have paid their Safety Inspection Fee. New entrant carriers will receive inspections early in their operations and will have to understand all required safety and operating requirements, such as drug testing. Carriers with poor safety records will receive the attention they need to ensure they operate safely. This will add to the overall safety record of the industry, improving the public perception.
This proposal is another example of industry and state regulatory agency cooperation to resolve a problem and ensure a fair solution is deployed to meet the needs of all involved. The solution will reduce regulatory burden and paperwork for the carriers, reduce fee collection administration activities, and allow the CHP to focus on inspection quality and quantity, which will translate into improved public safety.
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